Is the Cambodia second passport a scam?

Written by Andrew Henderson
i

Dateline: Siem Reap, Cambodia

In Khmer, Siem Reap literally means “Siam defeated”. It’s an old tribute to the great expansion of the Khmer Empire, which covered most of historical Indochina – and beyond – in Southeast Asia.

One thousand years ago, little was being written about Europe. It was a backward place. Asia was where the action is. Interesting how cyclical things are, isn’t it? And the Khmer Empire was at the center of the action. Khmers had access to an ever-growing territory and political stability.

These days, the situation isn’t quite as rosy.

As a result of imperialism, wars, and countless other interventions, Cambodia is now a shell of its former self. And government tyrants like Pol Pot didn’t exactly help the overall flow of economic freedom and growth.

But Cambodia’s need for investment creates opportunities for those looking to take advantage of frontier market investment potential. That may or may not come with extra benefits.

I’ve been talking to a few expat investors here in Cambodia, and several of them have mentioned the vague possibility of obtaining Cambodia citizenship and a second passport by investment.

Not only are the US citizens who live and invest here subject to draconian tax laws on money the US government had nothing to do with, but foreigners are excluded from owning certain assets here, namely ground floor apartments and agricultural land.

For those looking to invest as a local, a Cambodian passport is the only fool-proof workaround. But unless you’re married to a Khmer, you’ll have to jump through some hoops to obtain such a passport… and even if you could, I have serious doubts as to whether you’d want it.

You see, investors around the world use second passports to invest in places and projects they otherwise wouldn’t be welcome. Israeli citizens obtain dual citizenship to invest in other parts of Southeast Asia such as Malaysia where Israelis are banned, for example. Others obtain citizenship so they don’t have to put property in their spouse’s name.

So for those who agree with me that Cambodia real estate is a good market (in fact, it’s the only Southeast Asia real estate market I would and am invested in), the question remains: is Cambodia’s alleged second passport program a scam?

After all, the internet is full of shady “lawyers” sitting in some urine-soaked office on a remote island selling “offshore services” to suckers. One of the highest-ranking results for second passports on Google just shut down recently.

You have to be careful.

Technically, Cambodia has no second passport program, since obtaining a second citizenship requires either an economic contribution (ie: in the Caribbean) or by actually living there. The people talking about Cambodian citizenship for sale do live here but haven’t for long, and they are also curious if their absentee investors would qualify as well.

That’s the first red flag.

The only way to tell if you can legally obtain citizenship in a country is by reading its Constitution. There is a specific law you can point to and say, “there is what makes economic citizenship legal”. After all, “economic citizenship” is just a nice way of saying “citizenship for sale”, or “citizenship as a thank you for investing”.

Anything else is a black market second passport and should be avoided.

That’s not to say that no one has received a Cambodia passport. I know someone who did, in exchange for the alleged going rate of $50,000. (I’ve also heard $60,000, which would likely include legal fees and other mark-ups). However, that doesn’t mean anything; any corrupt official can churn out a “real” passport without recording you as a citizen. Even if you do obtain a citizenship certificate, it could be canceled later if you obtained it through bribery.

That’s the worry with these shady programs; you could pay some guy with a “connection” $50,000 only to get some fake papers.

Here’s how the program is purported to work: you make a donation of $50,000 to the government as an “investment”. All told, the process is supposed to take a little over three months, which was corroborated by my contact here.

Still, I’d avoid it. This article from all the way back in 1996 talked about the Cambodian government debating a draft law that would allow anyone who invested $500,000 to receive immediate citizenship… as soon as they proved they could speak Khmer.

Or, for a $400,000 donation – money you’d never see again – they suggested you could receive citizenship without learning the language. The investment would make sense if you wanted to invest anyway, but I doubt you’d want to learn Khmer. And the donation is a joke; you could get better for less.

I find it pretty suspect that $50,000 is the price for a citizenship now, nearly 20 years later, when almost every other citizenship by investment program has increased their rates.

From what I’m told, even low-level Cambodian officials aren’t interested in $50,000 payoffs to hand out questionable passports going forward. With all of the wealthy Russians developing $1 million villas on islands of the coast, paying $50,000 so you can buy some cheap land in a province and build a hut isn’t so attractive to the government.

Oh, and one more problem: what will you do with a passport from Cambodia?

It’s not exactly the world’s best travel document, and most of the countries that don’t are either in Southeast Asia or Africa. Worse yet, I know several experts who have consulted in immigration matters in Southeast Asia. They tell me that anyone who was to actually use their Cambodian passport to get into any of the neighboring countries would be thrown in a tiny cell and interrogated like crazy.

Everyone would know you, the pasty white guy, aren’t Khmer. Not even close.

The purported benefit of having a Cambodian passport wasn’t in its travel benefits, but more in being able to buy land, a privilege restricted only to locals.

While real estate in Phnom Penh has somewhat stagnated – I wouldn’t call it a bubble but it’s ceased to be dirt cheap – land in the provinces in some cases is dirt cheap.

If you have a solid plan to invest in Cambodia, a Cambodian passport would come in handy.

Just because you get a passport doesn’t mean it’s legitimate. Or good for travel. Heck, some of them aren’t even any good for banking.

Yes, some Chinese guys with hot money have purchased passports from places like Burkina Faso for the sole purpose of applying for residence in Hong Kong. That may work for them, but it won’t work for you. Play by the rules and find a legitimate program.

Cambodia is a beautiful place to visit, but I don’t suggest making it your second passport.

Andrew Henderson
Last updated: Dec 30, 2019 at 4:03PM

Start Your Offshore Journey Today

The Nomad Capitalist team has helped hundreds of people create and execute prolific offshore plans to help them legally reduce their taxes, become dual citizens, and live the Nomad Capitalist lifestyle of success

Start Your Offshore Journey Today

The Nomad Capitalist team has helped hundreds of people create and execute prolific offshore plans to help them legally reduce their taxes, become dual citizens, and live the Nomad Capitalist lifestyle of successWould you like to be next?

Get Our Latest Offshore Strategies

Join our email list and we’ll send our best articles, videos and events right to your inbox

Read this next..

9 Comments

  1. GreyPassportMan

    I’ve seen TDV Passports mention the Cambodia passport before on their website. Heres two worrying things about TDV Passports:

    1) They tried to sell people a grey market passport from Bulgeria for $17000 (this was later pulled)

    2) They are now trying to sell a Mexican passport for $40000 and it takes less than 6 months to have the Mexican passport in your hand

    Are these guys for real? Besides the Dominia and St Kits Nevis passport there are NO other economic passports for sale so they MUST be selling grey passports…yes?

    Theres just no info on the net about TDV Passports so I look forward to hear your thoughts!

    Reply
    • Andrew Henderson

      There are others who do have Cambodian passports, but you should understand how the program works and what it is. It’s not the best travel document to begin with, so it should be more of a tool for investment in the country than sovereign risk diversification. I can speak for Jeff Berwick but can’t speak about all TDV Passports. There are, however, made-to-measure solutions for ultra high-net worth individuals, like potentially Austria. It’s the low money that’s concerning.

      Reply
    • Tangible666

      They are rip-off artists who incite panic and offer nothing more than illegal tax dodges for their percentage of profit off of the top.

      Reply
  2. Lucky

    Will that $50,000 will be returned?

    Reply
    • Andrew Henderson

      No, it is essentially a donation. At least Cambodia isn’t as greedy as Cyprus, which requires a multi-million dollar investment AND donation. Apparently the Cypriot government has a short memory – surprise, surprise.

      Reply
  3. TD

    How can I invest in Paraguay or Panama to get permanent residence. Where to find legit companies?

    Reply
  4. Deli Telran

    Cambodia is a bad country just in the same classification as Haiti mentioned by Mr.Trump. He just said the truth; there are substandard countries and we call a table a table. Cambodia is poor, communist dictatorship and its passport is worthless, less worth than an ID card,no hospitals, no infrastructure. No wonder every cambodian tries everything to leave that place.

    Reply
  5. Worldwide Novelty Documentation

    I would like to thank the author for this nice informative post.

    Reply

Submit a Comment

Your email address will not be published. Required fields are marked *

This site uses Akismet to reduce spam. Learn how your comment data is processed.